Shifting agriculture away from the grid may help address fiscal challenges faced by the Tamil Nadu state government. The paper presents a cost-benefit analysis of implementing solarised irrigation pumps in Erode district, Tamil Nadu. The analysis is based on underlying assumptions on climatic conditions, cropping patterns and irrigation requirements in the district. The results suggest that the state and discom can benefit from the solarisation of agriculture if they can sell surplus power to commercial and industrial (C&I) consumers or in the power exchange market. The paper also performs cost-benefit analysis with the assumption of reduction in solar panel costs in future and finds that the discom would continue to gain net positive benefits. The paper also recommends formalising higher feed-in tariffs, supporting capital cost through subsidies, and exploring alternative procurement approaches.

Solarisation in agriculture in Tamil Nadu: a first principles evaluation, Susan Das, Renuka Sane and Ajay Shah, XKDR Working Paper 30, January 2024.